Market demand is how much consumers desire a product over a period of time. Determining market demand is vital in creating a successful product and marketing strategy because it allows businesses to make informed decisions about pricing, target markets, product development, etc. You can establish a product or service that people want by identifying market demand. In other words, you’ll achieve product-market fit, which will position your company to win big. Every stage of your business should include market demand research. There are many factors that may influence your product’s market demand. The following are some common factors that can determine market demand:
- Price: Price is the key factor influencing market demand. In general, as a product’s price rises, its demand will decrease consequently, and vice versa. However, in some cases, a lower product price may have a negative impact on its sales—luxury brands are a good example. Luxury brands are most often associated with high quality, craftsmanship, and exclusivity, and their prices are usually set to reflect these characteristics. If a luxury brand lowers its prices, it may be perceived as compromising on quality, and consumers may consider the brand as less prestigious and desirable as a result.
- Consumer income: The target market’s income is also an essential factor influencing demand. Consumers are more likely to spend money on goods and services when they have more disposable income, which can increase demand. On the other hand, if the target consumer in the market generally has a lower income, then the demand for the product will decrease. Thus, however, this does not apply to the need for necessities.
- Competition: The degree of competition in a market can also impact demand. It can be tough to stand out and attract customers if many direct competitors in your industry provide similar products.
- Seasonal changes: Seasonal changes can also have an impact on market demand. For example, demand for ice cream is typically high in the summer, whereas demand for snow shovels and winter jackets is higher in the winter. Therefore, many ice cream suppliers will launch new flavours in the summer to attract more leads and sales.
- Changes in consumer preferences: Consumer preferences can shift over time, affecting product demand. For example, a shift towards healthier eating habits may increase demand for organic foods.
- Marketing and advertising: The efficiency of marketing and advertising can influence product demand. A well-executed marketing campaign can generate greater product awareness and demand.
- Substitute availability: The availability of substitutes can also have an impact on demand. If a similar product is available at a lower price or with better features, demand for your product may decrease.
How to determine market demand for your product
- Conduct market research on your target consumer
Market research is used to test the viability of a new product or service by contacting a potential customer directly. Through conducting market research to understand customer needs, preferences, and behaviour. This can help you identify what customers want, what they are willing to pay for, and why they are not dissatisfied. Thefore, it is crucial to help you determine market demand for your product. In addition, market research also allows you to cultivate brand loyalty and customer satisfaction by identifying the key demographics and market segments most likely to consume a product. Additionally, market research informs a company’s advertising efforts, enabling them to tailor their approach to a platform or appeal to value-sensitive consumers by improving the product rather than reducing prices.
To conduct effective market research, define clear study goals that address specific problems, such as determining the demand for a product. After that, you can decide who will be included in the research and how the data will be collected. This should account for statistical errors, sampling bias, and the need to target specific consumer groups. Next, you can start to collect and analyse the data. Information can be gathered using various methods, including surveys, phone research, focus groups, interviews, and social media monitoring. Finally, executives use research to make business decisions, such as targeting a different consumer group or adjusting product features and pricing. Future research may measure the impact of these changes and begin the process anew.
You can conduct market research in-house, by your company or by an outside market research firm.
- Analyse competitors
Analyze your competitors to grasp their products, pricing, marketing strategies, and how customers perceive them. This can assist you in identifying market gaps that your product can fill. Furthermore, by observing your competitors’ sales, you can learn what customers buy and how much they are willing to pay for similar products. This can assist you in determining the potential demand for your product as well as developing a unique selling proposition (USP) for your product, helping you to identify areas where you can differentiate yourself from the competition.
Access to TradeData.Pro allows you to track your competitors’ transactions by searching export data
You may be wondering where you can find your competitors’ data. Don’t worry, TradeData.Pro is here to help you collect organized competitor data at your fingertips. TradeData.Pro provides import-export data that covers exclusive shipping details such as importer company names, HS code, product description, quantity, value, country of origin, transport type, port, and other information. The customs data is a complete set of statistics and analyses that can help you identify your foreign competitors and determine the products and volumes imported to your market. Moreover, you can also read more on this blog about how to monitor your competitors.
- Track market trends
Changes in market trends may have an impact on demand for your product. Consider demographic shifts, technological advancements, economic conditions, social trends and other factors that may affect demand for your product. Here are two examples of what these factors could be:
Demographic shifts: Changes in the population, such as ageing, migration, or income levels, can affect demand for specific products or services. For instance, your healthcare product market demands may be increasing in ageing population trends as the elderly consumers may be concerned about their health care.
Technological advancements: Technological advancements can either create new opportunities for products and services or disrupt existing markets. For example, the rise of smartphones and mobile apps has transformed how people communicate and access information, opening up new opportunities for mobile app developers and service providers.
Therefore, you can follow the latest trends to anticipate whether your product demand will increase or decrease and adapt strategies accordingly. Consequently, maintain success in a rapidly changing business landscape by staying on top of market trends. Attending trade shows, conferences, and other events, as well as reading industry publications and news sources, such as TradeData.Pro trade data intelligence, can help collect intelligence about market trends. For example, continue to read this blog to learn about the global trade forecast for 2023.
- Utilise SEO tools
To determine market demand using SEO, you can use keyword research tools like Google Keyword Planner, Ahrefs, or SEMrush to identify search volume, competition, and estimate organic traffic. You can also analyze the search volume and competition for specific keywords using Google Trends. Additionally, a content gap analysis can be used to identify opportunities in the market. This involves analyzing the topics and keywords your competitors are ranking for and identifying gaps in the market that your product can fill. By identifying unique selling points for your product, you can differentiate yourself from the competition and meet the needs of your target audience.
To accurately determine the market demand for a product, there are several strategies that your business can use. In addition to conducting market research on the target consumer and analyzing competitors, it is also important to track market trends and utilize SEO tools. The best way we’d recommend is to retrieve and analyse the latest trade data of your competitors using TradeData.Pro, a powerful online platform that provides comprehensive global customs and shipping data. By combining these strategies, your business can gain a deep understanding of market demand for your product and make informed decisions about your business strategies.
The most trustable and reliable source for Trade Data.
TradeData.Pro is a reliable and trustworthy source of trade data proudly made in Singapore, a country known for its stable political climate and trade-driven economy. Presented by Commodities Intelligence Centre, a government-linked company and a joint venture of Zall Smartcom, SGX, and GeTS, TradeData.Pro has received positive feedback from the market since its launch in 2018 for its extensive coverage, affordability, and fast response. The platform has been awarded the Singapore Quality Class in 2020 and the Stevie Award Gold in 2021.
Traditionally, obtaining critical data to reveal trends, identify market opportunities, track competitors, buyers, and suppliers, and better understand the potential of the supply chain has been a challenge. However, the detailed shipment information that is part of government import and export filing requirements does exist and forms the core of global trade. TradeData.Pro has gathered and packaged this information as business intelligence, which helps companies understand the flow of goods across borders and features the world’s largest searchable trade database. TradeData.Pro reviews, standardizes, and cleans data and delivers it in an intuitive format, making it easier for businesses to access.
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